I have an annuity that pays me £370 per month. I understand that the rules have changed and I can cash it in from April 2016. I am over retirement age btw.


But I am struggling to find out very roughly what the value of the pot is and the annuity company are especially unhelpful. Can anyone give me a clue as to value based on typical rates paid out?


I know there are disadvantges of doing this but a key factor is that when I die the income is gone but if I have the cash then it is mine to keep.


Also if anyone knows about tax implications?


Thanks, David

 

Cant help from knowing about it I am afraid but logic would say tax would be payable on the lump sum especially if the monthly figure is taxed? (they try to tax everythign these days)

As far as getting a figure the annuity company surely are obliged to tell you as you are their customer.

hope you get it sorted.

 

Thanks


Monthly payment is taxed. But I believe there is a tax free element if you just cash part only of a pension.


Annuity company just say amount depends on rates applicable at the time. They do not understand the word "Approx".


David

 

I think from what I have read about this, it is not a particularly good deal for the seller.

Annuities are "auctioned" to institutional investors, who offer a lump sum in return for your income. The investor will want an in-depth health check carried out on the seller which will influence the offer made. It is reported that the value offered will typically be 60-70 percent of the pre-tax value of the annuity and perhaps less where other factors come into play.

With the number of variables involved, I think you would be wise to to engage the services of someone who specializes in advice in this field to even gain a ROM value for your annuity.

BTW - having just set up a new pension recently I am pretty sure the remainder of the annuity is passed to my wife and kids on my demise. May be worth a read of the small print in your documentation.

 

Thanks TT,


I think selling it on to someone is a different matter. I am single now but if I remarried then my new wife would be entitled to something. But zilch as I am unmarried.


All the best to you for Christmas. btw the boy was top of the Irish charts recently. Now spends quite a lot of time busking in Liverpool - hard work!!


David

 

David, I would look into it, in some depth before you press the button

Annuities are notoriously tricky

Ps how is that 60 a day smoking habit?

 

Whoops, misread - you are selling not buying - as you where

But in any case look into it carefully

 

Thanks chaps. First thing I learnt this morning is that effing Osborne has now delayed date for selling from April 2016 to April 2017 so I hope I can last out that long!


David

 

Thanks David, trust you have a good Christmas also. Talent + Hard work will hopefully bring James & Key West the success they deserve.

Regrettably sad but true though....